About the author

Mark J. Perry is concurrently a scholar at AEI and a professor of economics and finance at the University of Michigan's Flint campus. He is best known as the creator and editor of the popular economics blog Carpe Diem. At AEI, Perry writes about economic and financial issues for American.com and the AEIdeas blog.

Early reports on August home sales are showing strong double-digit gains all over

Local reports are coming in for August home sales and so far they’re all showing double-digit gains from last year, here’s a sample:

1. Milwaukee – Sales of existing homes rose 21% in August in the metro Milwaukee area, extending a string of 14 year-over-year monthly increases that is reducing the inventory of homes on the market. Through the first eight months of 2012, sales were up 27.7%.

2. Baltimore — Home sales were the highest for the month of August since 2007, with a 17.5% year-over-year increase. Pending sales in August were up 18% versus last year and the average home price increased 3%.

3. Memphis — Home sales in August were up 21% year over year, representing the eighth consecutive monthly increase from 2011. Inventory is down, days on the market are down, and agents are cautiously optimistic for growth.

4. Birmingham – August home sales increased 18.4% vs. last year, average price was up 13% and median price by 3%.

5. Nashville – Home sales increased by 27.3% in August compared to a year ago, and the median price increased by 1.8%.

6. Iowa — Home sales pushed 15.5% higher to 3,602 in August over a year ago, and the median sale prices climbed 3.8 percent.

7. Denver - August home sales increased 18% above last year, and average prices were up by 10%.

8. North Texas (29 county region) — Sales of existing homes in North Texas in August were up 18% from a year ago, marking the 12th consecutive month of gains, and eight straight of double-digit increases. The median sales price rose 8 percent to $164,000.

Nothing’s wreaked quite the havoc on the U.S. economy, and indeed the national psyche, as the six-year slide in home prices. It wiped out some $7 trillion in household wealth, savaged bank balance sheets, and induced the Great Recession and the tepid recovery.

Yet there are unimpeachable signs that this national nightmare is now over. Home prices are starting to rise, if somewhat haltingly, in most areas of the country. And a number of forecasters predict home-price increases around 10% or so nationally over the next three years, with some metropolitan statistical areas, such as Midland, Texas, and Bismarck, N.D., likely riding the energy-exploration boom to better than 20% jumps in residential-real-estate prices.

Discussion: (1 comment)

David P. Goldman published an article in First Things stating that the number of families needing a three bedroom two bath house had been essentially unchanged since the early 1970’s. The supply of such houses had roughly doubled. Regarding a house as a way to obtain wealth was never a sound idea. The cost ultimately reflects the utility, even though there are temporary manias that make some of us lose sight of that fact. When we return to our collective senses, some of us learn some painful lessons.